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The USD/JPY pair trades in positive territory near 153.70 during the early Asian session on Monday. The Japanese Yen (JPY) retreats from an over one-week high amid the uncertainty over the timing of the next interest rate hike by the Bank of Japan (BoJ).

ABC News reports that a sufficient number of Democrats are expected to back a short-term funding measure to end the U.S. government shutdown.

The proposal would extend federal funding until January 31 and fully finance the SNAP food assistance program and Veterans Affairs for the entire fiscal year, according to Senate sources.

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Stay tuned for further on this, just ‘reports’ at this stage, lets see what eventuates.

If true it should be a risk positive event.

Earlier on such moves is here:

• Sunday session for US Senate as lawmakers seek band aid funding for 10% of government

This article was written by Eamonn Sheridan at investinglive.com.

Speech by Deputy Governor Andrew Hauser

• Topic is On the Rails or Off to the Races? The Outlook for the Australian Economy
• venue is the UBS Australasia Conference, Sydney

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At its previous meeting the Bank expressed a less dovish view, slashing marekt forecasts for rate cuts any time soon. Inflation remains sticky high.

This article was written by Eamonn Sheridan at investinglive.com.

The recent optimism for a yen rebound is fading fast as major banks downgrade their forecasts and investors scale back expectations for an early Bank of Japan rate hike, with fiscal concerns under Prime Minister Sanae Takaichi adding fresh downward pressure on the currency.

Japanese media, the Nikkei, runs the report this morning, Tokyo time. In brief:

• JPMorgan Chase cut its year-end forecast for the yen to 156 per dollar from 142, and now sees 152 by March 2026 instead of 139.
• MUFG Bank and Sumitomo Mitsui Banking Corp. made similar downward revisions, signalling broad skepticism that the BOJ will tighten policy anytime soon.

At its most recent meeting, the BOJ left interest rates unchanged

• Governor Kazuo Ueda said the bank needed more time and data before deciding on rate hikes, prompting traders to interpret his stance as cautious.
• “It’s not a stage to proactively buy yen,” said Hirofumi Suzuki, chief FX strategist at SMBC, adding that there was “no groundwork” for an early move.
• Market pricing implies only a 57% chance of a rate hike in December.
• Analysts note that monetary policy expectations have become less influential than politics and fiscal signals.

Concerns are growing over Takaichi’s plans for “responsible and proactive” fiscal spending, with investors wary that a large supplementary budget could further weaken the yen.

MUFG’s Teppei Ino said the market will likely remain under selling pressure until the scale of the new stimulus is revealed. The government is expected to finalise its extra budget later this month.

Adding to the uncertainty, new members appointed to the Economic and Fiscal Policy Council come from Japan’s reflationist camp, reinforcing the view that Tokyo may tolerate a weaker currency.

JPMorgan’s Junya Tanase noted that “the selling reaction to Takaichi’s policies has been stronger than expected.”

While some strategists, including Citigroup’s Osamu Takashima, expect eventual yen buying as part of profit-taking in Japanese equities, most see limited support in the near term.

Markets are now watching an upcoming speech by BOJ policy board member Junko Nakagawa on November 10 for fresh clues on the central bank’s policy path.

This article was written by Eamonn Sheridan at investinglive.com.

You note the Chinese inflation data was published over the weekend, post is here ICYMI:

• China October inflation data: CPI 0.2% y/y (expected 0%), PPI -2.1% y/y (expected -2.2%)

The highlight of the event calendar today in Asia-Pacific is the Bank of Japan ‘Summary of Opinions’ from the October meeting.

From the day:

• Bank of Japan leaves rates unchanged, as expected
• JPY has dropped after the Bank of Japan expected ‘on hold’ decision, Nikkei up
• BOJ governor Ueda: Easy monetary conditions will continue to support the economy
• BOJ governor Ueda: No preset ideas about timing of next rate hike
• BOJ governor Ueda: We need more data in deciding to adjust degree of monetary easing
• BOJ governor Ueda: Want to see early momentum of spring wage negotiations

Don’t want to read that lot? Here is TD’s take on the decision and Ueda, seems a reasonable one:

• The BoJ’s hold and Ueda’s cautious remarks weakened the yen, but TD Securities said a December move remains on the table as wage data and fiscal coordination evolve.

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The Bank of Japan (BOJ) releases a “Summary of Opinions” after each monetary policy meeting. It serves as a record of the discussion and views of the Policy Board members on various economic and financial issues.

Key points about the Summary:

• The summary includes the views of the Policy Board members on economic conditions, both domestically and globally. This includes assessments of economic growth, inflation, and employment trends, among other indicators.
• The summary also outlines the Policy Board members’ views on the effectiveness of the BOJ’s current monetary policy measures, including interest rate policy, asset purchases, and yield curve control. Members may discuss the pros and cons of these policies and their potential impact on the economy.
• The summary includes discussions on the outlook for monetary policy and the potential risks to the economy. Board members may express their views on the appropriate timing and direction of future policy changes, as well as the potential impact of external factors such as global economic conditions.
• The summary also includes any dissenting views among the Policy Board members. If a member disagrees with the majority view on a particular issue, they may express their own opinion and rationale.

In a few week’s time we’ll get the Minutes of this meeting. The Minutes are a more detailed record of the discussions and decisions made during the meeting.

• The Minutes include a more complete record of the views expressed, including any dissents or alternative opinions that may not be included in the summary.
• The Summary of Opinions is typically released a few days after the policy meeting, while the Minutes are published about a month later. This means that the Summary of Opinions can provide more up-to-date information on the BOJ’s current stance and view on the economy and monetary policy.
• The Summary of Opinions is usually written in a more accessible language, making it easier to understand the BOJ’s views on monetary policy.
• The Minutes, on the other hand, are often more technical and may require a deeper understanding of economics and financial markets.
• The Summary of Opinions is typically shorter than the Minutes.

This article was written by Eamonn Sheridan at investinglive.com.

China’s Consumer Price Index (CPI) rose 0.2% in October from a year ago after arriving at a fall of 0.3% in September, the National Bureau of Statistics of China reported on Sunday. The market consensus was for 0% in the reported period.

U.S. Transportation Secretary Sean Duffy has warned that air travel disruptions will deepen in the coming days as the country faces a third consecutive day of federally mandated flight reductions amid the ongoing government shutdown.

Duffy spoke in an interview with CNN’s State of the Union

• “It’s only going to get worse,”
• flight capacity could shrink to a “trickle” in the two weeks leading up to Thanksgiving
• a “substantial number” of Americans could miss holiday travel plans as a result
• on Saturday alone, there were 81 “staffing triggers”, incidents where flight operations were curtailed due to staffing shortages

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The background to this chaos is the government shutdown. As essential workers, controllers are required to work during a shutdown but without pay. This has led to widespread absenteeism, many controllers are seeking gig economy work to put food on the table, and operational strain.

• The Federal Aviation Administration (FAA) introduced the cuts on Friday, affecting 40 major airports nationwide, in response to worsening air traffic controller shortages.
• By Sunday morning, more than 4,200 flights had been delayed and 1,520 cancelled, with Duffy warning tha
• The FAA expects the flight reductions to escalate over the week: capacity will drop 4% this weekend, 6% by Tuesday, 8% by Thursday, and up to 10% by Friday.

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Flight disruptions threaten to dent consumer spending and tourism activity heading into the U.S. holiday season. Extended shutdown-related travel chaos could ripple through airlines, hospitality, and retail sectors, adding short-term pressure to service-driven GDP growth.

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If you are in the US and planning a Thanksgiving flight, have back up plans in place would be my advice.

This article was written by Eamonn Sheridan at investinglive.com.

New York Federal Reserve President John Williams has warned that growing financial strain on lower- and middle-income Americans could undermine the broader U.S. economy’s resilience, even as wealthier households benefit from a booming stock market.

Williams spoke in an interview with the Financial Times, link here for transcript (gated) .

• said the Fed’s December policy meeting would be “a balancing act”
• officials will weigh persistent inflation, its high and not showing signs of coming down at present, against an economy that remains resilient.
• cautioned that many Americans are struggling with rising housing and living costs
• such pressures risk weighing on consumer confidence and spending

This article was written by Eamonn Sheridan at investinglive.com.

Goldman Sachs says U.S. investors are ramping up their exposure to Japanese equities, chasing the country’s standout returns and its growing focus on technology and artificial intelligence.

The report on the note is via Bloomberg.

Bruce Kirk, Goldman’s chief Japan equity strategist, said inflows from the U.S. are now accelerating at the fastest pace since the Abenomics era

• active participation by U.S. investors is the highest since October 2022
• Goldman Sachs is fielding an increasing number of meeting requests from U.S. clients.
• rising participation of U.S. funds could mark a turning point, as foreign investors shift toward growth and technology shares after years of value-stock dominance
• Tokyo’s pro-investor reforms and the government’s corporate-governance drive have supported
• global investors’ holdings of Japanese equities remain light compared with the peak Abenomics period, suggesting room for further buying

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The surge reflects Japan’s strong performance in dollar terms. The Nikkei 225 has jumped about 30% this year, far ahead of the S&P 500’s 14% gain, helped by a firmer yen and investor optimism over Prime Minister Sanae Takaichi’s pro-stimulus economic stance.

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Renewed U.S. inflows into Japan could support the Nikkei’s outperformance and reinforce global risk appetite. The shift toward Japanese tech and AI shares also suggests investors are diversifying away from U.S. megacaps, potentially broadening global equity leadership.

This article was written by Eamonn Sheridan at investinglive.com.

Senators returned to Capitol Hill for an unusual Sunday session as efforts intensified to bring an end to the 40-day government shutdown. While no formal votes were initially scheduled, Senate Majority Leader John Thune told reporters that “we plan to vote today” on a funding proposal intended to reopen parts of the government.

The Senate released three draft spending bills covering Agriculture and the Food and Drug Administration, the Legislative Branch, and Military Construction and Veterans Affairs. Combined, they account for about 10% of overall federal funding.

However, the proposed legislation leaves unresolved the central issue behind the shutdown — the lapse of Affordable Care Act Medicare subsidies. Republicans are expected to attach provisions addressing these subsidies to a short-term continuing resolution, in an effort to draw bipartisan backing and end the standoff that has shuttered portions of the federal government for over a month.

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The prolonged U.S. government shutdown continues to cloud fiscal outlooks, delaying data releases and threatening broader confidence in Washington’s ability to govern effectively. Investors are watching closely for signs of a bipartisan deal before further disruptions to federal payments and economic reporting.

The damage is ongoing, earlier:

• Bessent says shut down impact getting worse for economy, Hasset says recession possible

This article was written by Eamonn Sheridan at investinglive.com.